Omantel is acquiring a 9.8% stake in Kuwait’s Zain Group for $846 million in a cash transaction.

The agreement covers 425.7 million of Zain’s treasury shares, and requires a green light from the regulator.

Martial Caratti, Omantel’s CFO, described the holding as “a deliberate investment for Omantel as we position ourselves as a leading digital service provider. This is in line with our Corporate Strategy 3.0, launched in 2015. We have always emphasised that growth will come from continued diversification, and this acquisition positions Omantel for the future.”

Zain meanwhile said that the agreement would “provide significant liquidity” and that “the proceeds will be used for general corporate purposes, including the potential prepayment of certain debt obligations.” The group’s CEO Bader Nasser Al-Kharafi noted that this liquidity would enable further financial and strategic possibilities “at a time where we continue to seek opportunities in the digital space and invest in upgrading our modern networks to enhance the mobile experience for our customers.”

Omantel and Zain are aiming to cooperate on “core business functions” in the hopes of broadening their revenue streams and leveraging Zain’s global footprint. The group operates in eight markets across the Middle East and Africa.

Earlier this year, Zain entered a bid for Oman’s third mobile licence, with the winner due to be announced on 4th September. Omantel is the country’s largest operator with 3.9 million connections, while Ooredoo has 2.8 million.